CS Manoj Joshi

(FCS, MBA, CAIIB, B.Com, AMFI)

Practicing Company Secretary

Indore (M.P.)
csmanojjoshi@gmail.com

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The information on GST, provided in this presentation,
has been collected from various sources/medias and has
accordingly been compiled merely to exchange the
academic knowledge regarding GST. Some of the
information, in this presentation, may or may not be
latest or updated. Our firm accepts no liability for the
content of this presentation or for the consequences of any
actions or decision taken on the basis of any provision,
procedure or information provided hereunder. Recipient
/ Readers of this presentation should consult an
authorised tax consultant to ascertain the applicability
and procedure of GST.

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General Service Taxation (GST)
scheme known as Good and
Services Tax (GST) is an indirect tax
throughout India to replace taxes
levied by the Central and State
Governments. The GST is governed
by GST Council and its Chairman is
Finance Minister of India.
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GST is a kind of Indirect Tax. Before
GST, We were paying Indirect Tax to
State & Central Governments by way
of Value Added Tax, Service Tax,
Excise Duty, Customs Duty, Octroi
Tax, luxury tax and Entertainment
Tax etc. All these taxes were levied
on the traders/manufacturers and
were passed down to the consumer.

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GST will prevent the multiple taxation,
having cascading effect, occurring on
certain goods thereby ensuring
transparency with regards to the rate of
taxation and the total amount that goes to
the government as taxes on a product.
Currently, a consumer is not aware of the
total amount of taxes he pays for a
product, apart from VAT which is
mentioned on the bill.

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GST is to simplify the tax system and to makes it easier to
understand and also cheaper to implement at various
levels. Tax evasion at various stages is expected to be
eliminated as tax offsets can be collected only if taxes have
been paid actually. It is now possible to buy raw materials
or constituent materials for production only from those
who have actually paid taxes, in order to claim input
benefits. It will be cheaper to buy input goods and services
for production from other states. As such the input material
can be brought from anywhere throughout the country. The
consumer will get the end-product at cheaper rates because
of elimination of multiple taxes and the tax cascade.

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Indirect Taxes which do not exist after GST
are Excise Duty, Service Tax, Central Sales
Tax, Surcharge Cess, VAT, Taxes on
Lottery, Luxury Tax, Entry Tax,
Entertainment Tax. GST has 4 tax slabs i.e.
5%, 18%, 12 % , & 28%.

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GST will apply when turnover of the
business exceeds Rs 20 lakh. Therefore,
taxpayers with an aggregate turnover of
Rs. 20 lakh would be exempted from tax.
For, North Indian states and Sikkim, the
exemption would be Rs. 10 lakh.

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Aggregate turnover includes the aggregate value of:

(i) all taxable and non-taxable supplies,

(ii) exempt supplies, and
(iii) exports of goods and/or service of a person having the
same PAN.
The above shall be computed on all India basis and
excludes taxes charged under the CGST Act, SGST Act
and the IGST Act. Aggregate turnover does not include
value of supplies on which tax is levied on reverse charge
basis, and value of inward supplies.

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Under GST many food items have been
exempted from any of the tax slabs. Such as,
milk, butter milk, curd, natural honey, fresh
fruits and vegetables, flour, besan, bread, all
kinds of salt, jaggery and hulled cereal grains,
fresh meat, fish, chicken, eggs. Further, bindi,
sindoor, kajal, palmyra, human hair and
bangles Drawing or colouring books alongside
stamps, judicial papers, printed books,
newspapers, jute and handloom, bones and
horn cores, hoof meal, horn meal, bone grist,
bone meal, etc. also do not attract any tax
under GST.
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Medicine, insulin and stent, apparel below Rs
1000, footwear below Rs 500, fish fillet,
packaged food items, cream, skimmed milk
powder, branded paneer, frozen vegetables,
coffee, tea, spices, pizza bread, rusk,
sabudana, cashew nut, cashew nut in shell,
raisin, ice and snow, bio gas, kerosene and
coal, agarbatti (incense sticks), kites, postage
or revenue stamps, stamp-post marks,
fertilizers, first-day covers and lifeboats,
transport services like railways and air travel
fall, small restaurants.

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Cellphones, Ayurvedic medicines and all
diagnostic kits and reagents, frozen meat
products, butter, cheese, ghee, dry fruits in
packaged form, animal fat, sausage, fruit
juices, namkeen, ketchup & sauces, spoons,
forks, ladles, skimmers, cake servers, fish
knives, tongs, tooth powder, umbrella, sewing
machine and spectacles and indoor game
items like playing cards, chess board, carom
board and other board games like ludo and
apparel above Rs 1000.

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Biscuits, flavoured refined sugar, pasta, cornflakes, pastries
and cakes, preserved vegetables, jams, sauces, soups, ice
cream, instant food mixes, curry paste, mayonnaise and salad
dressings, mixed condiments and mixed seasonings and
mineral water, footwear costing more than Rs 500, printed
circuits, camera, speakers and monitors, printers (other than
multi function printers), electrical transformer, CCTV, optical
fiber, bidi leaves, tissues, envelopes, sanitary napkins, note
books, steel products, kajal pencil sticks, headgear and its
parts, aluminium foil, weighing machinery (other than electric
or electronic weighing machinery), bamboo furniture,
swimming pools and padding pools, AC hotels that serve
liquor, telecom services, IT services, branded garments and
financial services

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Bidi, chewing gum, molasses, chocolate not
containing cocoa, waffles and wafers coated
with choclate, pan masala and aerated water,
deodorants, shaving creams, after shave, hair
shampoo, dye and sunscreen, paint, wallpaper
and ceramic tiles, water heater, dishwasher,
weighing machine, washing machine, ATM,
vending machines, vacuum cleaner, shavers,
hair clippers, automobiles, motorcycles and
aircraft for personal use.

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Reverse Charge means the liability to pay the tax
by person receiving goods and/or services
instead of the person supplying such goods
and/or services in respect of specified categories
of supplies. The purpose of reverse charge is to
increase tax compliance and tax revenues.
Earlier, the tax authorities were not able to collect
service tax from various unorganized sectors like
goods, transport etc. Compliances and tax
collections will be increased through this
mechanism
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CBEC has notified a list of services on which tax shall be
paid by the recipient on 100% reverse charge basis, like:

Non-resident service provider , Goods Transport

Agencies, Legal service by an Advocate/ Firm of
Advocates, Arbitral Tribunal, Sponsorship Services,
Specified Services provided by Government or Local
Authority to Business entity , Services of a director to a
company, Insurance agent , Recovery gent of Bank/FI/
NBFC, Transportation Services on Import ,Permitting use
of Copyright, Radio Taxi services to E-commerce
aggregator.

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CGST means Central goods and service tax to
replace the existing tax like service tax, excise,
etc. and it is levied by central government. Tax
will be collected by the Central government. It
is applicable on Intra-state supply. No
registration required till the turnover crosses
Rs. 20 Lakh ( Rs.10 lakh for north eastern
states). The dealer can use the benefit up to
Rs.75 lakh under the composition scheme. The
composition scheme is not applicable in
interstate sup

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SGST means State goods and service tax,
replace the existing tax like sales tax, luxury
tax, entry tax, etc. and it is levied by the
state government. Tax will be collected by
State government. It is applicable on Intra-
state supply. No registration is required till
the turnover crosses Rs.20 Lakh ( Rs.10
lakh for north eastern states). The dealer
can use the benefit up to Rs.75 lakh under
the composition scheme

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IGST refers to the Integrated Goods and
Services Tax which is a part of GST under the
concept of one nation one tax. It is charged on
the goods and services supplied from one state
to another. It is a combined form of CGST and
IGST and it is levied by central government. Tax
will be collected by the Central government. It is
applicable on Interstate supply. Registration is
mandatory in case of IGST.

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IGST equals to CGST+SGST. The IGST model envisages
that the centre will levy tax at a rate approximately equal
to CGST+SGST on Inter-State supply of goods &
services. It is a destination based tax and will accrue to
importing state. It will lower tax burden by taxing Inter-
State transaction only once. Under B2B transactions the
tax will flow to the State where Purchaser claims Input
Tax Credit and under B2C transactions the tax will flow to
the State of Consumer, otherwise tax will remain in the
State of Seller.

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When a registered taxable person supplies
taxable goods or services, a GST invoice is to be
issued. A registered person must issue a tax
invoice before, or at the time of removal of goods
for supply to the recipient. For supplying
services, invoices can be issued before, at, or
even after the time of supply. It is based on the
rules regarding the details required in an invoice.
The serial number shall be furnished
electronically in FORM GSTR 1 of invoices
issued during a tax period

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 Name, Address & GSTIN of supplier
 Consecutive Serial Number
 Date of issue (related to concept of Time of Supply)
 Name, Address & GSTIN (if registered) of recipient
 HSN/SAC code (as per eligibility on turnover basis)
 Description of Goods, Quantity & Taxable Value
 Rate & Amount of Tax – CGST, SGST, IGST
 Place of Supply (and Address of Delivery if it is different from
POS)
 Reverse Charge
 Signature or Digital Signature

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GST invoice is issued in order to charge the tax
from the recipient and also pass on the credit.
However, there are some instances in GST
where the recipient may not be a registered
person or where the supplier is not allowed to
charge any kind of tax and therefore a GST
invoice can’t be issued. Instead, another
document called Bill of Supply is issued. The
bill of supply is required to be issued in case of
supply of Exempted /Nil-rated, Non –taxable
/Non-GST goods or services, paying tax under
the composition scheme

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 Name, Address & GSTIN of supplier
 Consecutive Serial Number
 Date of issue
 Name, Address & GSTIN (if registered) of recipient
 HSN/SAC code
 Description of Goods, Quantity & Value
 Signature or Digital Signature

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HSN/SAC code shall be mentioned in Tax Invoice
as well as furnished in Table 12 of FORM GSTR-
1. The taxpayers who have turnover below the
limit of Rs 1.5 Crore will have to mention the
description of goods/service in place of code.
Whereas, the description is optional for taxpayers
who are required to furnish HSN/ SAC codes on
the basis of aggregate turnover.

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Any person with the aggregate turnover not
exceeding Rs. 75 lakhs (Rs. 50 Lakhs for
North Eastern States) shall be eligible to
pay tax by composition scheme

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No permission shall be granted to a taxable
person under certain conditions:

Who is engaged in the supply of services (except

service of restaurant) or who makes any supply
of goods which are not leviable to tax under this
Act or who makes any inter-State outward
supplies of goods or who makes any supply of
goods through an e-commerce operat or who is
required to collect tax at source or who is a
manufacturer of such goods as may be notified

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The following categories of persons shall be required to be
registered compulsorily irrespective of the threshold limit:

a) persons making any inter-State taxable supply;

b) casual taxable persons;
c) persons who are required to pay tax under reverse charge;
d) non-resident taxable persons;
e) persons who are required to deduct tax under section 37;
f) persons who supply goods and/or services on behalf of
other registered taxable persons whether as an agent or
otherwise;

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 Less than Rs. 1.5 crores – HSN/SAC code is not
mandatory (Hence, composition dealers may not be
required to specify HSN at 2-digit level also).
 Rs. 1.5 crores to Rs. 5 crores – HSN code at minimum 2
digit chapter level is mandatory. SAC code is mandatory.
 Above Rs. 5 crores – HSN code at minimum 4 digit
chapter level is mandatory. SAC code is mandatory.
 For export turnover, 8-digit HSN code is mandatory
irrespective of any of the above 3 categories.

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The following...........
g) input service distributor;
h) persons who supply goods and/or services other than
branded services, through electronic commerce operator;
i) every electronic commerce operator;
j) an aggregator who supplies services under his brand name
or his trade name; and
k) such other person or class of persons as may be notified by
the Central Government or a State Government on the
recommendations of the Council.

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The person who is registered as a composition
taxpayer shall at the top of the bill of supply
issued by him, mention the words- “not eligible
to collect tax on supplies”. Reason being that a
person registered as the composite taxpayer is
not eligible to collect tax on the supplies from
his buyer rather tax is paid by the composite
taxpayer himself at the special rates decided
for the composition dealers

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Supply of goods or services or both is
defined as sale, transfer, barter,
exchange, license, rental, lease or
disposal made or agreed to be made for
a consideration by a person in the course
or furtherance of business.

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Place of supply means the place where a supply of goods
or services is made & where the GST may be charged or
paid. Determining the location of supply of services may
be difficult especially in inter-state services. In some
cases place of supply is determined by what is supplied
rather than where the supplier or consumer belongs.
Whenever there is a supply of goods or services, then for
the purpose of GST it is required to know the Place of
Supply. The place of supply determines which type of
GST is to be paid, whether IGST, CGST or SGST and
how the dealers have to account for Input Tax Credit on
purchase and Output Tax on sale.

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Where a supply is received at a registered place
of business, then it means the location of such
place of business ,where a supply is received at
a place other than the registered place of
business, then it means the location of such fixed
establishment, where a supply is received at
more than one establishment, then it means the
location of the establishment most directly
concerned with the receipt of the supply, if cannot
be identified, then it means the location of the
usual place of residence of the recipient.

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Any person located in the taxable territory
representing such supplier for any purpose in the
taxable territory shall get registered and pay
IGST on behalf of the supplier. If such supplier
does not have a physical presence or does not
have a representative for any purpose in the
taxable territory, he may appoint a person in the
taxable territory for the purpose of paying IGST
and such person shall be liable for payment of
such tax.

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Intra-State is a type of supply of goods or
services where the location of the
supplier and the place of supply of goods
are in the same State or same Union
Territory except for supply of goods to or
by a Special Economic Zone developer
or a SEZ unit or Goods imported into the
territory of India or Supplies made to a
tourist.
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It is a supply of goods or services, where the
location of the supplier and place of supply are
in two different States or two different Union
territories or a State and a Union territory. It
also includes import of goods or services into
the territory of India. When the supplier is
located in India and the place of supply is
outside India to or by a Special Economic
Zone (SEZ) developer or a SEZ unit; or in the
taxable territory, not being an intra-state supply
and not covered elsewhere shall also be
treated as inter-state supply.
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Input Tax Credit (ITC) under GST is a credit available to
supplier to set off the tax he has already paid on
purchase of goods from output tax on supply of such
goods. Therefore, the tax will be levied on the value
added to the commodity which ultimately results in
avoiding double taxation. Input Tax in relation to a taxable
person, means the tax charged on any supply of goods
and/or services to him which are used in the course or
furtherance of his business, but does not include the tax
paid under the Composition levy

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GST Tax Invoice is one of the most essential item for input
tax credit. A GST Tax Invoice shall be retained whenever
an input tax is paid. Whenever a tax credit refund is
claimed, the goods and services on which it is claimed
shall have to be received. In order to process the refund
of input tax credit under GST, a proof of this will be
required . A proof of actual tax paid by the dealer or
supplier to the government shall also be required. The
refund of input tax credit under GST cannot be claimed if
the GST has not been paid or the proof has not been
retained.

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It is compulsory for every GST taxpayer to file
the returns to the concerned GST authorities.
Therefore, to apply for GST input tax credit, a
copy of GST Return is necessary. The details of
the transactions shall also be included in the
returns furnished so that they can be easily
verified and checked with respect to the
authenticity of the input tax credit paid to the
dealer of the specified goods and (or) services

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 A person will be entitled to Input Tax Credit (ITC) under
GST in respect of inputs held in stock or in semi
finished state, immediately preceding the date of which
he becomes liable to pay tax, if he has applied for new
registration. Voluntary registration can be taken by any
person. He can pay tax even when his turnover is less
than the specified limit. He can take Input Tax Credit
under GST in respect of the goods which are held in
stock on the day immediately preceding the registration
date. If a person who has opted for composition
scheme switches over to the normal scheme, then he
shall be entitled to take Input Tax Credit under GST in
respect of “goods held in stock” on the day immediately
preceding the date when he becomes liable to pay tax
as normal taxpayer.

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The Input Tax Credit under GST of CGST
shall be first utilized towards the payment
of output CGST and then towards the
payment of output IGST. However, Input
Tax Credit under GST of CGST can’t be
used to adjust SGST

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The Input Tax Credit under GST of SGST
shall be first utilized towards the payment
of output SGST and then towards the
payment of output IGST. However, Input
Tax Credit under GST of CGST can’t be
used to adjust CGST

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The Input Tax Credit under GST of IGST
shall be first utilized towards payment of
IGST then towards the payment of output
CGST and then towards the payment of
output SGST

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Reverse Charge means the liability to pay the
tax by person receiving goods and/or services
instead of the person supplying the goods
and/or services in respect of specified
categories of supplies. The purpose of reverse
charge is to increase tax compliance and tax
revenues. Earlier, the tax authorities were not
able to collect service tax from various
unorganized sectors like goods, transport etc.
Compliances and tax collections will be
increased through this mechanism

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 GSTIN – Goods and Services Taxpayer Identification
Number
 UIN – Unique Identification Number
 UQC – Unit Quantity Code
 HSN – Harmonised System of Nomenclature
 SAC – Services Accounting Code
 POS – Place of Supply of Goods and Services
 B2B – From one registered person to another registered
person
 B2C – From registered person to unregistered person

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It contains the prescribes the details to be provided
by the taxpayer in relation to outward supplies
made to the buyer for the relevant period. GSTR 1
needs to be filed, by the 10th of subsequent
month, by every taxpayer except Composition
Scheme taxpayers, Non-Resident Foreign
taxpayers, TDS deductors, E commerce Operators
and Input Service Distributors. The government
has notified new GST Return formats in this regard
and removed the mandatory requirement to quote
HSN codes for goods and SAC codes for services
in each table.

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Every registered taxable person is require to
submit “Return for Inward Supplies” in GSTR 2
The entries shall be mentioned by the buyer from
12th to 15th of the succeeding month.
Adjustments, if any, is allowed to the seller in
GSTR 1A on the 16th and 17th of the succeeding
month after the buyer has uploaded his GSTR 2.
Mandatory requirement to quote HSN codes for
goods and SAC codes for services has been
relaxed.

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The GSTR 4 is a return under GST that
needs to be filed once every 3 months by
registered tax payers who have signed up
for the composition scheme (those who opt
for this scheme are known as
compounding vendors). They would be
required to pay taxes at fixed rate without
any input tax credit facilities.

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The taxpayer is only required to indicate the total
consolidated value of supplies made during the
period and the tax paid at the composition rate.
Taxpayer will also need to declare invoice-level
purchase information for the purchases from
normal taxpayers, which will be auto-drafted in
Form GSTR 4A from supply invoice uploaded by
counter-party taxpayers in GSTR 1. GSTR 4 has
a total of 13 pre-filled headings.

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GST cess is a compensation cess to be imposed
for a period of 5 years from GST implementation.
Both intrastate and interstate supplies of goods
or services would attract GST cess over and
above the applicable CGST, SGST, and IGST
rates. It is imposed on the supply of goods or
services to provide compensation to the States
for loss of revenue due to the implementation of
GST in India.

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If any funds are unutilised, then at the end of the
transition period, it would be shared equally by
the Central and State Government. State
Government’s share will be distributed in the
ratio of their total revenues from State Tax on the
goods and services in the last year of the
transition period. GST cess will be applicable on
both supplies of goods and services. All
taxpayers under GST except taxpayers registered
under GST composition scheme are required to
collect and remit GST cess.

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Aggregate turnover does not include value of inward
supplies on which tax is payable on reverse charge basis.
Outward supplies on which tax is paid on reserve charge
basis by the recipient will be included in the aggregate
turnover of the supplier.

If the person is engaged in 100% supply of goods which

are not liable for GST, then no registration is required
under GST. Not liable to tax means supplies which is not
leviable to tax under the CGST /SGST/IGST Act.

53
A supplier of service will have to register at the location
from where he supplying services. Exemption from
registration has been provided to such supplier who are
making only those supplies on which recipient is liable to
discharge GST under RCM.

A person dealing with 100% exempted supply is not liable

to register irrespectively of turnover. There is no liability of
registration if the person is dealing with 100% exempt
supplies.

Supplies to SEZs are zero-rated supplies and supplies by

SEZs to DTA are treated as imports.

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There will be only one registration per State for all activities.
Any person who make intra-state taxable supply is required to
take registration. Therefore in this case AP dealer shall take
registration and pay tax.

There will no area based exemption in GST. An unregistered

person has 30 days to complete its registration formalities from
its dates of liability to obtain registration.

SGST of one State cannot be utilized for discharging of output

tax liability of another State. SGST Credit can be used for
payment of IGST liability under the same GSTIN only.

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Tax will be collected in the State from which the supply is
made. The supplier will collect IGST and the recipient will
take IGST credit.

Detailed rules for reversal of ITC when the supplier is

providing exempted and non-exempted supplies have
been provided in ITC Rules.

Invoice, credit or debit notes, as the case may be, on

behalf of unregistered person will be issued by registered
person only. Further, GSTR2 provides for reporting of
same by recipient.

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There is no requirement to take Aadhaar/PAN
details of the consumer under the GST Act.

All expenses will have to be included in the value

and invoice need to be issued accordingly.

The export procedure for Nepal would be same

as that of other countries. Customs duty and
cess as applicable+ IGST+GST compensation
cess shall be paid after adding all customs duty
and customs cess to the value of imports.

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csmanojjoshi@gmail.com
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